Questions from Individual Taxation

Q: Jessica’s friend Zachary once stated that he couldn’t understand why someone would

Jessica’s friend Zachary once stated that he couldn’t understand why someone would take a tax course. Why is this a rather naïve view?

Q: The U.S. Constitution is the highest tax authority but

The U.S. Constitution is the highest tax authority but provides very little in the way of tax laws. What are the next highest tax authorities beneath the U.S. Constitution?

Q: What happens to capital losses that are not deductible in the current

What happens to capital losses that are not deductible in the current year?

Q: When taxpayers borrow money to buy municipal bonds, are they allowed

When taxpayers borrow money to buy municipal bonds, are they allowed to deduct interest expense on the loan? Why or why not?

Q: What are the implications of treating losses as passive?

What are the implications of treating losses as passive?

Q: Seth invested $20,000 in Series EE savings bonds on

Seth invested $20,000 in Series EE savings bonds on April 1. By December 31, the published redemption value of the bonds had increased to $20,700. How much interest income will Seth report from the sa...

Q: At the beginning of her current tax year, Angela purchased a

At the beginning of her current tax year, Angela purchased a zero-coupon corporate bond at original issue for $30,000 with a yield to maturity of 6 percent. Given that she will not actually receive...

Q: Christopher sold 100 shares of Cisco stock for $5,500

Christopher sold 100 shares of Cisco stock for $5,500 in the current year. He purchased the shares several years ago for $2,200. Assuming his marginal ordinary income tax rate is 28 percent, and he ha...

Q: What is the difference between earned and unearned income?

What is the difference between earned and unearned income?

Q: Do taxpayers always add back the standard deduction when computing alternative minimum

Do taxpayers always add back the standard deduction when computing alternative minimum taxable income? Explain.